Computer

Networks
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Business Applications of Computer Networks

Most companies have a substantial number of computers. For example, a company may have a
computer for each worker and use them to design products, write brochures, and do the payroll.
Initially, some of these computers may have worked in isolation from the others, but at some point,
management may have decided to connect them to be able to distribute information throughout the
company.

For smaller companies, all the computers are likely to be in a single office or perhaps a single
building, but for larger ones, the computers and employees may be scattered over dozens of offices
and plants in many countries. Nevertheless, a sales person in New York might sometimes need
access to a product inventory database in Singapore.

A second goal of setting up a computer network has to do with people rather than information or
even computers. A computer network can provide a powerful communication medium among
employees. Virtually every company that has two or more computers now has email (electronic
mail), which employees generally use for a great deal of daily communication.

Telephone calls between employees may be carried by the computer network instead of by the
phone company. This technology is called IP telephony or Voice over IP (VoIP) when Internet
technology is used. The microphone and speaker at each end may belong to a VoIP-enabled phone
or the employee’s computer. Companies find this a wonderful way to save on their telephone bills.

Other, richer forms of communication are made possible by computer networks. Video can be
added to audio so that employees at distant locations can see and hear each other as they hold a
meeting. This technique is a powerful tool for eliminating the cost and time previously devoted to
travel. Desktop sharing lets remote workers see and interact with a graphical computer screen. This
makes it easy for two or more people who work far apart to read and write a shared blackboard or
write a report together. When one worker makes a change to an online document, the others can
see the change immediately, instead of waiting several days for a letter. Such a speedup makes
cooperation among far-flung groups of people easy where it previously had been impossible. More
ambitious forms of remote coordination such as telemedicine are only now starting to be used (e.g.,
remote patient monitoring) but may become much more important.

A third goal for many companies is doing business electronically, especially with customers and
suppliers. This new model is called e-commerce (electronic commerce) and it has grown rapidly in
recent years. Airlines, bookstores, and other retailers have discovered that many customers like the
convenience of shopping from home. Consequently, many companies provide catalogues of their
goods and services online and take orders online. Manufacturers of automobiles, aircraft, and
computers, among others, buy subsystems from a variety of suppliers and then assemble the parts.
Using computer networks, manufacturers can place orders electronically as needed. This reduces
the need for large inventories and enhances efficiency.

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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Classification of Networks by scales

Type Inter-processor Distance Reach

Personal Area Network 1m Square Meter
10 m Room

Local Area Network 100 m Building

1 km Campus

Metropolitan Area Network 10 km City

100 km Country
Wide Area Network
1000 km Continent

Internet 10,000 km Planet

Personal Area Network

PANs (Personal Area Networks) let devices communicate over the range of a person. A common
example is a wireless network that connects a computer with its peripherals. Usually these
peripherals are connected by wired connections. Many new users had a hard time finding the right
cables and plugging them into right sockets (even though they are usually colour coded) that most
computer vendors offer the option of sending a technician to the user’s home to do it. To help these
users, some companies got together to design a short-range wireless network called Bluetooth to
connect these components without wires. The idea is that if your devices have Bluetooth, then you
need no cables. You just put them down, turn them on, and they work together. For many people,
this ease of operation is a big plus. Operating at approximately 1 Mbps with an effective range from
1 to 10 meters, Bluetooth promises to change significantly the way we use computers and other
telecommunication devices

Local Area Network (LAN)

A LAN is a privately owned network that operates within and nearby a single building like a home,
office or factory. LANs are widely used to connect personal computers and consumer electronics to
let them share resources
(e.g., printers) and
exchange information.
When LANs are used by
companies, they are
called enterprise
networks.

Wireless LANs are very

popular these days,

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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especially in homes, older office buildings, cafeterias, and other places where it is too much trouble
to install cables. In these systems, every computer has a radio modem and an antenna that it uses to
communicate with other computers. In most cases, each computer talks to a device in the ceiling as
shown in following Fig. This device, called an AP (Access Point), wireless router, or base station,
relays packets between the wireless computers and also between them and the Internet.

Wired LANs use a range of different transmission technologies. Most of them use copper wires, but
some use optical fibre. Typically, wired LANs run at speeds of 100 Mbps to 1 Gbps, have low delay
(microseconds or nanoseconds), and make very few errors. Newer LANs can operate at up to 10
Gbps. Compared to wireless networks; wired LANs exceed them in all dimensions of performance.
It is just easier to send signals over a wire or through a fibre than through the air.

Metropolitan Area Network (MAN)

A MAN (Metropolitan Area Network) covers a city. The best-known examples of MANs are the
cable television networks available in many cities. These systems grew from earlier community
antenna systems used in areas with poor over-the-air television reception. In those early systems, a
large antenna was placed on top of a nearby hill and a signal was then piped to the subscribers’
houses.

When the Internet began attracting a mass audience, the cable TV network operators began to
realize that with some changes to the system, they could provide two-way Internet service in
unused parts of the spectrum. At that point, the cable TV system began to morph from simply a way
to distribute television to a metropolitan area network. To a first approximation, a MAN might look
something like the system shown in figure above. In this figure we see both television signals and
Internet being fed into the centralized cable headend for subsequent distribution to people’s
homes.
Prof. Maulik Gondhia Prof. Bhavin Bhuva
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Cable television is not the only MAN, though. Recent developments in high- speed wireless Internet
access have resulted in another MAN, which has been standardized as IEEE 802.16 and is popularly
known as WiMAX.

Wide Area Network

Wide area networking combines multiple LANs that are geographically separate. This is
accomplished by connecting the different LANs using services such as dedicated leased phone lines,
dial-up phone lines (both synchronous and asynchronous), satellite links, and data packet carrier
services. Wide area networking can be as simple as a modem and remote access server for
employees to dial into, or it can be as complex as hundreds of branch offices globally linked using
special routing protocols and filters to minimize the expense of sending data sent over vast
distances.

A WAN (Wide Area Network) spans a large geographical area, often a country or continent. Below is
the example of a company using WAN with branch offices in different cities. The WAN in figure
below is a network that connects offices in Perth, Melbourne, and Brisbane. Each of these offices
contains computers.

The WAN as we have described it looks similar to a large wired LAN, but there are some important
differences that go beyond long wires.

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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Intranet
With the advancements made in browser-based software for the Internet, many private
organizations are implementing intranets. An intranet is a network inside an organization that uses
Internet technologies (such as Web browsers and servers, TCP/IP network protocols, HTML
hypermedia document publishing and databases, and so on) to provide an Internet-like
environment within the enterprise for information sharing, communications, collaboration, and the
support of business processes. In other words, Intranet is a private version of Internet. For large
organizations, an intranet provides an easy access mode to corporate information for employees.

An intranet is protected by security measures such as passwords, encryption, and firewalls. A

company’s intranet can also be accessed through the intranets of customers, suppliers, and other
business partners via extranet links. Intranets can provide an enterprise information portal for
applications in communication and collaboration, business operations and management, Web
publishing, and intranet portal management.

Extranet
Extranets are network links that use Internet technologies to interconnect the intranet of a
business with the intranets of its customers, suppliers, or other business partners.

Internet
The Internet is a collection of interconnected networks that use certain common protocols and
provide certain common services. It is a system of linked networks that are worldwide in scope and
facilitate data communication services such as remote login, file transfer, electronic mail, the World
Wide Web and newsgroups. Each network is independent from its neighbours, and so ultimately, no

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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one country or organization "owns" the Internet. International advisory and standards groups of
individual and corporate members, such as the Internet Society (www.isoc.org) and the World
Wide Web Consortium (www.w3.org), promote use of the Internet and the development of new
communications standards.

The Internet has become the largest and most important network of networks today and has
evolved into a global information superhighway. The Internet was initially restricted to military and
academic institutions, but now it is a full-fledged conduit for any and all forms of information and
commerce. Internet websites now provide personal, educational, political and economic resources
to every corner of the planet.

When this network of networks began to grow in December 1991, it had about 10 servers. In
January 2004, the Internet was estimated to have more than 46 million connected servers with a
sustained growth rate in excess of 1 million servers per month. In January 2007, the Internet was
estimated to have more than 1 billion users with Web sites in 34 languages. Thousands of business,
educational, and research networks now connect millions of computer systems and users in more
than 200 countries.

The Internet cannot be accessed directly by individuals; we need to use the services of a company
that specializes in providing easy access. An ISP, or Internet service provider, is a company that
provides access to the Internet to individuals and organizations. For a monthly fee, the service
provider gives you a software package, user name, password, and access phone number or access
protocol. With this information (and some specialized hardware), you can then log onto the
Internet, browse the World Wide Web, and send and receive e-mail. Through these connections,
one ISP can easily connect to another ISP to obtain information about the address of a Web site or
user node.

Use of Internet

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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Business Use of Internet

As Figure below illustrates, business use of the Internet has expanded from an electronic
information exchange to a broad platform for strategic business applications. Notice how
applications such as collaboration among business partners, providing customer and vendor
support, and e-commerce have become major business uses of the Internet. Companies are also
using Internet technologies for marketing, sales, and customer relationship management
applications, as well as for cross-functional business applications, and applications in engineering,
manufacturing, human resources, and accounting.

Prof. Maulik Gondhia Prof. Bhavin Bhuva

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Business Value of Internet

The Internet provides a synthesis of computing and communication capabilities that adds value to
every part of the business cycle. What business value do companies derive from their business
applications on the Internet? Figure below summarizes how many companies perceive the
business value of the Internet for e-commerce. Substantial cost savings can arise because
applications that use the Internet and Internet-based technologies (like intranets and extranets) are
typically less expensive to develop, operate, and maintain than traditional systems.

It is estimated that for certain types of

transactions, the transaction cost savings
are significant for online versus more
traditional channels. For example:
booking a reservation over the Internet
costs about 90 percent less for the airline
than booking the same reservation over
the telephone. Other primary sources of
business value include attracting new
customers with innovative marketing and
products, as well as retaining present
customers with improved customer
service and support. Of course,
generating revenue through e-commerce
applications is a major source of business
value.

To summarize, most companies are building e-business and e-commerce Web sites to achieve six
major business values:

• Generate new revenue from online sales.

• Reduce transaction costs through online sales and customer support.
• Attract new customers via Web marketing and advertising and online sales.
• Increase the loyalty of existing customers via improved Web customer service and support.
• Develop new Web-based markets and distribution channels for existing products.
• Develop new information-based products accessible on the Web.

Prof. Maulik Gondhia Prof. Bhavin Bhuva